HOS becomes smaller factor on truck capacity

By Eric Kulisch

   I noted in this space a couple weeks ago that the U.S. Department of Transportation’s pre-Christmas update of the anti-fatigue rules governing drivers was not as burdensome to the trucking industry as most experts and officials feared.
   The new hours-of-service rules do further limit the maximum amount of driving time available to truckers each week, but the change mostly affects a minority of drivers who are on the road for long stretches at a time when most carriers are reorganizing operations to keep drivers regional rather than having them drive cross-country. Industry scored a victory when the DOT retained the 11-hour daily driving limit for commercial drivers.
   Still, there are groups that say the ruling is a big blow to carriers and their customers because it further exacerbates the short supply of drivers, potentially adding cost and causing shipment delays.
   But the uncertainty of what the pending rule will look like has been removed and a massive need for more trucks and drivers to haul freight has been avoided.
   Larry Gross, a senior consultant at FTR Associates, is also on record saying that the hours-of-service ruling makes for a much more stable trucking environment this year than expected, especially since no changes are scheduled to go into effect before 2013 at the earliest.
   “The conditions for the trucking industry will now turn on the fundamentals of supply and demand, as well as the continuing effects of existing new safety regulations such as CSA (Compliance Safety Accountability). We expect these factors combined will work to keep trucking capacity modestly tight over the course of the year, enabling continued progress on trucking rates for carriers,” he said in a recent news release about the company’s latest Trucking Conditions Index.
   The index for November increased by less than two points from the previous month to a reading of 5.2, continuing a trend of modestly favorable growth, pricing and supply conditions for carriers.
   “The removal of HOS regulation changes from the 2012 equation has made a severe capacity shortage much less likely,” FTR said.
   The Trucking Conditions Index is a compilation of factors affecting trucking companies. Any reading above zero indicates an adequate trucking environment with readings above 10 a sign that volumes, prices and margin are in a good range for trucking companies.
   The American Trucking Associations also noted more progress in the trucking market for November, with its seasonally adjusted truck tonnage index increasing 0.3 percent after rising a revised 0.4 percent in October. 
   During the September-through-November period tonnage is up 2.3 percent and is at the highest level since January 2011.
   “Two primary factors have helped truck tonnage in recent months. First, manufacturing output, which generates a significant amount of truck freight, has generally been increasing. Second, retail inventories are very lean, which is helping freight as well since retailers don’t have much excess stock and need to replenish when sales go up,” ATA Chief Economist Bob Costello said in a Dec. 21 statement.